Granite Shoals grants temporary reprieve on street lien interest
The city of Granite Shoals is suspending an 8 percent interest rate for two years on street liens owed to the city in an effort to encourage affected property owners to pay off the debt. Staff photo by Jennifer Fierro
Granite Shoals residents who received notice of street liens against their properties will receive a little relief, but it’s only temporary. The City Council approved suspending the 8 percent annual interest on those debts for the next two years during its regular meeting April 13.
City Attorney Joshua Katz said it was within the council’s discretion to stop adding interest but noted the city must do what it can to collect the liens.
“The Texas Constitution doesn’t allow cities to allow indebtedness to disappear,” he said.
City Manager Jeff Looney made the recommendation to the council.
“When the liens were enacted many years ago, from that point forward, there’s been 8 percent awarded to the property every year,” he said. “And it grew until it’s been paid. Now, (residents) have the opportunity to get them paid without any interest.”
Between 1979 and 1985, Granite Shoals made assessments against property owners for various street improvements. The amount of the assessment was based on the length of the property that abutted the city roadway. The city placed a lien, which is a legal claim to secure repayment, on properties where the owner did not pay the assessment. Over the years, those original liens with accrued interest have grown, substantially, in some individual cases.
Looney developed a 50-25-25 payment plan, which calls for residents to pay 50 percent of the lien in the first payment and 25 percent in the second and third payments.
“Fifty is hard and tough, but it shows you are committed,” he said.
The street paving liens still have more than $200,000 “sitting on the books not accounted for,” Looney said.
Looney said a street lien is an assessment, not a tax, which means city leaders have a duty to collect them.
“Every effort was given to the landowners. They were informed,” Looney said. “We’ve beat this horse and covered all that we can cover. This is under the state constitution.”
While curtailing the 8 percent interest for two years might not seem like much, it’s something Looney hopes will help.
“This allows people to take a deep breath and make a plan to take care of it and work with us to do it,” he said. “We still care. We want to help you with the money owed.”
In 2019, city leaders sent letters to residents regarding street liens against their properties that compelled some homeowners to address the matter with the City Council directly.
During a March 9 meeting, Looney told the council the city had collected approximately $44,000 of the owed street liens. This represented 35 respondents from 146 letters sent to property owners with street liens.